4 ways to turbocharge accounts receivable
For anyone who doesn’t work in accounts receivable, account receivable might sound like a pretty simple process. Money comes in, you mark that the client has paid and you deposit the money into the business bank account. Done.
But for those of us who know better, we are very much aware that accounts receivable is rarely that straightforward. Sure, the money comes in, but figuring out who and what the cash is actually for can actually be pretty tricky.
If you’re using a manual system, there’s a lot of data to work with and you’ll have to do everything from correcting old information to inputting new data, along with other tasks like communicating with customers and settling disputes.
So how can you speed up the accounts receivable process, while also reducing errors and improving cash flow? Here are our four top tips:
1. Ditch the spreadsheets
Spreadsheets are powerful and effective tools when utilised properly – and they’re also convenient, since you probably already have the software on your computer.
However, they’re just not suitable for the extensive and often complicated information that needs to be collected and stored during the accounts receivable process. Spreadsheets are prone to mistakes, they’re difficult to keep updated and can get clunky if there’s too much information. Plus, finding the right piece of data within a large spreadsheet can be tricky too.
Accounts receivables can be a monotonous process that requires a lot of data input and searching for information. While people can do the task, it can be a slow and tedious process that requires careful attention to detail to avoid mistakes.
But it turns out that computers are great at the process and can process the information much faster and more accurately than a human. By automating accounts receivable, you can improve your own data, get payments processed faster and free up time so your accounts receivable team can provide better customer service.
3. Invoice electronically
Sending out e-invoices can provide a number of benefits. For example, clients will receive their bills almost immediately and you don’t have to spend money on printing costs or postage.
Another benefit of e-invoicing is that it can speed up accounts receivable. because it’s all done over the computer, you can enjoy better data accuracy, while ensuring that all compliance standards are met. It also offers enhanced account reconciliation, as customers can send electronic remittance advice with the payment, providing key information about invoices paid, as well as debits, credits and adjustments.
4. Analyse results
Regular reviews of your accounts receivable function can help to prevent defaults and identify other risks before they become problems. This often doesn’t happen because data analysis and running reports can be time-consuming and complicated if you aren’t using the right tools.
VP Customer Success
“Quality is when we achieve the customer’s expectation. But we are trying to create a service aptitude that we recognize opportunities to exceed the customer’s expectations.”